august 4, 2010 advice letter 4110 establishment of the advanced … · 2018-10-04 · advice no....

STATE OF CALIFORNIA ARNOLD SCHWARZENEGGER, Governor

PUBLIC UTILITIES COMMISSION 505 VAN NESS AVENUE

SAN FRANCISCO, CA 94102-3298

August 4, 2010 Advice Letter 4110 Rasha Prince, Director Regulatory Affairs 555 W. Fifth Street, GT14D6 Los Angeles, CA 90013-1011 Subject: Establishment of the Advanced Metering Infrastructure Balancing Account (AMIBA), Update of the Revenue Requirement and Modification of Existing Tariffs to Implement D.10-04-027 Dear Ms. Prince: Advice Letter 4110 is effective April 8, 2010. Sincerely,

Julie A. Fitch, Director Energy Division

May 10, 2010 Advice No.4110 (U 904 G) Public Utilities Commission of the State of California Subject: Establishment of the Advanced Metering Infrastructure Balancing Account

(AMIBA), Update of the Revenue Requirement and Modification of Existing Tariffs to Implement Decision (D.) 10-04-027

Southern California Gas Company (SoCalGas) hereby submits for filing revisions to its tariffs, applicable throughout its service territory, as shown on Attachment B. Purpose

In compliance with the California Public Utilities Commission (Commission) D.10-04-027, Ordering Paragraph (OP) 7, SoCalGas hereby establishes the Advanced Metering Infrastructure Balancing Account (AMIBA). In accordance with D.10-04-027, SoCalGas is also revising Rule No. 14 – Meter Reading to include language on bill estimates due to AMI meter installation and Rule No. 31 – Automated Meter Reading, to eliminate unnecessary provisions. In addition, this filing updates the AMI revenue requirement to reflect the total costs and benefits as adopted in D.10-04-027 which will be collected in rates beginning on January 1, 2012 through December 31, 2017.

Background On April 8, 2010, the Commission issued D.10-04-027 approving SoCalGas’ AMI Application (A.) 08-09-023 with modifications which authorizes $1,050.7 million of capital and O&M expenditures for SoCalGas’ AMI project over a proposed deployment period of 2009 through 2015. However, due to the delay in obtaining approval of SoCalGas’ AMI project, the deployment period is revised to an estimated deployment period of April 2010 through April 2017 which is consistent with the seven-year deployment period as proposed in A.08-09-023 and is reflected in the revenue requirements as described herein. During this period SoCalGas will install six million gas AMI meter modules that would provide usage information to customers leading to energy conservation and resulting benefits.

Rasha Prince Director

Regulatory Affairs

555 W. Fifth Street, GT14D6 Los Angeles, CA 90013-1011

Tel: 213.244.5141 Fax: 213.244.4957

[email protected]

Advice No. 4110 - 2 - May 10, 2010

Establishment of AMIBA Pursuant to OP 7 of D.10-04-027, SoCalGas is establishing the AMIBA, effective April 8, 2010, to record O&M and capital-related costs associated with the authorized $1,050.7 million in gas program costs.1 The AMIBA will compare the actual O&M expenses and revenue requirement associated with capital expenditures against the corresponding revenue requirement recovered in rates. Other Tariff Changes Rule No. 14, Meter Reading – Special Condition C.4 has been added to Rule No. 14 to state that if SoCalGas is unable to gain access to install the AMI devices, the utility may bill the customer for estimated consumption consistent with Rule No. 14. Rule No. 31, Automated Meter Reading – The following sections have been eliminated as the cost/benefit analysis adopted in D.10-04-0272 does not include costs associated with obtaining a manual meter read once every three years or providing customers with copies of SoCalGas Tariff Rule No. 31:

A.4. The Utility may render bills based upon readings from the automated meter reading device, provided an actual meter reading is obtained at least once every three (3) years. B.9. A copy of this Rule will be provided to the customer when the automated meter reading device is installed.

Updates to the Revenue Requirement SoCalGas is updating the AMI revenue requirements to reflect the changes to the costs and benefits as authorized in D.10-04-027, which decreased the funding amount and delayed the initial start date of system and meter deployment. The deployment period was initially proposed for a seven-year period beginning in 2009. The shift in the deployment schedule has a material impact on the revenue requirement because both the expenditures and the realization of the benefits are postponed in the first year of deployment. As such, the revenue requirements, both costs and corresponding benefits, have been revised to reflect the shift of the deployment period to a seven-year period beginning in April 2010. In addition, the O&M benefits associated with working cash have been included in the revenue requirement through Year 2015 as future working cash benefits will be incorporated in the next General Rate Case (GRC) subsequent to SoCalGas’ 2012 GRC. 3 Also, to prevent rate volatility, SoCalGas is not changing rates to implement the AMI program at this time, but will rather revise rates January 1, 2012 to consolidate the impacts of the 2010 through 2012 authorized revenue requirements.4 The rate changes will be included in SoCalGas’ annual consolidated gas transportation rate updates to be filed via advice letter in late December 2011 for rates effective January 1, 2012. The impacts of deferring until January 2012 the application of the 2010-2011 revenue requirements in rates

1 OP 5 of D.10-04-027 states that SoCalGas can record $1,100.7 million to the AMIBA, which represents the $1,050.7 million, plus 50% of the $100 million associated with the risk contingency and sharing mechanism described in the Preliminary Statement. 2 A.08-09-023, SoCalGas Exhibit 3, p. III-25. 3 The next GRC is anticipated to be in 2016, assuming the 2012 GRC is a four-year cycle. 4 As shown in Attachment C, the revenue requirements for 2010 and 2011 are negative as a result of the tax benefits associated with information technology (IT) costs.

Advice No. 4110 - 3 - May 10, 2010

will be reflected in the AMIBA, including accrued interest. Table MF-4 (Capital and O&M Costs/Benefits) from Chapter 7 of A.08-09-023 is updated in the corresponding table below to reflect the costs and benefits for the seven-year deployment period consistent with D.10-04-027. Also included is an update to the supporting tables which reflect the annual and monthly revenue requirement from Chapter 7, Attachment MF 15-1, provided as Attachment C to this advice letter.

Total 2010 2011 2012 2013 2014 2015 2016 20175 year IT assets 54,652 4,858 5,898 6,939 7,980 8,819 9,659 10,499 - 5 year SD Software 36,637 14,351 22,286 - - - - - - 15 year capital - Network Infrastructure 99,171 - - 19,035 19,452 19,854 20,217 20,613 - 20 year capital - Gas Modules 539,259 930 3,420 47,705 102,794 116,658 118,644 104,337 44,771 31 year capital - Gas Meters 146,596 561 65 25,341 30,470 31,449 32,099 26,611 - Total Capital* 876,314 20,699 31,669 99,019 160,696 176,780 180,620 162,060 44,771

Total O&M Costs 174,333 1,576 3,542 14,232 27,719 32,708 36,488 38,650 19,419

Total Costs 1,050,647 22,276 35,210 113,252 188,415 209,488 217,107 200,710 64,189

Total O&M Benefits (184,815) - - (7) (4,186) (18,033) (33,620) (56,633) (72,334)

* Capital amounts exclude AFUDC

Annual Summary of Capital and O&M Costs- 2010-2017 ($ in thousands)

Southern California Gas CompanyAdvanced Metering Infrastructure

Final Decision - April 8, 2010All Property and O&M - Total Costs and O&M Benefits

SoCalGas’ Next GRC The AMI business case analysis and revenue requirement were developed under the assumption that SoCalGas would complete its AMI deployment by 2015 and that changes to AMI revenue requirements associated with the deployment efforts will be incorporated in rates in connection with its annual consolidated gas transportation update filings until SoCalGas’ next GRC. Due to the delay in obtaining approval of SoCalGas’ AMI system, SoCalGas anticipates completion of its deployment in Year 2017. As such, SoCalGas seeks authority to continue to update the AMI revenue requirement via advice letter until the costs and benefits of the AMI system can be incorporated into the next GRC. If the final decision in SoCalGas’ 2012 or subsequent GRC application changes the fixed overheads that have been used to develop the AMI costs and benefits, SoCalGas seeks authority to adjust its revenue requirement accordingly. In addition, to the extent that O&M benefits, including working cash benefits, associated with AMI project are included in SoCalGas’ future GRC proceedings, the AMI revenue requirement will be adjusted accordingly along with the factor used in determining the actual O&M benefits recorded in the AMIBA. This filing does not conflict with any rate schedules or any other rules, or cause the withdrawal of service. Protest Anyone may protest this Advice Letter to the Commission. The protest must state the grounds upon which it is based, including such items as financial and service impact, and should be

Advice No. 4110 - 4 - May 10, 2010

submitted expeditiously. The protest must be made in writing and must be received within 20 days of the date of this Advice Letter which is May 30, 2010. There is no restriction on who may file a protest. The address for mailing or delivering a protest to the Commission is:

CPUC Energy Division Attention: Tariff Unit 505 Van Ness Avenue San Francisco, CA 94102

Copies of the protest should also be sent via e-mail to the attention of both Maria Salinas ([email protected]) and Honesto Gatchalian ([email protected]) of the Energy Division. A copy of the protest should also be sent via both e-mail and facsimile to the address shown below on the same date it is mailed or delivered to the Commission.

Attn: Sid Newsom Tariff Manager - GT14D6 555 West Fifth Street Los Angeles, CA 90013-1011 Facsimile No. (213) 244-4957 E-mail: [email protected]

Effective Date SoCalGas believes that this filing is subject to Energy Division disposition, and should be classified as Tier 1 (effective pending staff approval) pursuant to G 96-B. SoCalGas respectfully requests that this filing be approved and the AMIBA be effective on April 8, 2010, the date of D.10-04-027. Notice A copy of this advice letter is being sent to the parties listed on Attachment A which includes parties to A.08-09-023.

_________________________________ Rasha Prince

Director – Regulatory Affairs Attachments

CALIFORNIA PUBLIC UTILITIES COMMISSION ADVICE LETTER FILING SUMMARY

ENERGY UTILITY MUST BE COMPLETED BY UTILITY (Attach additional pages as needed)

Company name/CPUC Utility No. SOUTHERN CALIFORNIA GAS COMPANY (U 9O4G) Utility type: Contact Person: Sid Newsom

ELC GAS Phone #: (213) 244-2846 PLC HEAT WATER E-mail: [email protected]

EXPLANATION OF UTILITY TYPE

ELC = Electric GAS = Gas PLC = Pipeline HEAT = Heat WATER = Water

(Date Filed/ Received Stamp by CPUC)

Advice Letter (AL) #: 4110

Subject of AL: Establish AMIBA, Update Revenue Requirement, and Modify Existing Tariffs Keywords (choose from CPUC listing): Balancing Account, Meters, Compliance AL filing type: Monthly Quarterly Annual One-Time Other Periodic If AL filed in compliance with a Commission order, indicate relevant Decision/Resolution #: D.10-04-027 Does AL replace a withdrawn or rejected AL? If so, identify the prior AL No Summarize differences between the AL and the prior withdrawn or rejected AL1: N/A Does AL request confidential treatment? If so, provide explanation: No Resolution Required? Yes No Tier Designation: 1 2 3

Requested effective date: 4/8/10 No. of tariff sheets: 11 Estimated system annual revenue effect: (%): Estimated system average rate effect (%): When rates are affected by AL, include attachment in AL showing average rate effects on customer classes (residential, small commercial, large C/I, agricultural, lighting). Tariff schedules affected: Preliminary Statement Part V, Rule No. 14, Rule No. 31, TOCs Service affected and changes proposed1: N/A Pending advice letters that revise the same tariff sheets: None

Protests and all other correspondence regarding this AL are due no later than 20 days after the date of this filing, unless otherwise authorized by the Commission, and shall be sent to: CPUC, Energy Division Southern California Gas Company Attention: Tariff Unit Attention: Sid Newsom 505 Van Ness Ave., 555 West 5th Street, GT14D6 San Francisco, CA 94102 Los Angeles, CA 90013-1011 [email protected] and [email protected] [email protected]

1 Discuss in AL if more space is needed.

ATTACHMENT A

Advice No. 4110

(See Attached Service Lists)

Advice Letter Distribution List - Advice 4110 Page 1

Alcantar & Kahl Kari Harteloo [email protected]

Alcantar & Kahl Seema Srinivasan [email protected]

Alcantar & Kahl LLP Annie Stange [email protected]

Alcantar & Kahl, LLP Mike Cade [email protected]

Barkovich & Yap Catherine E. Yap [email protected]

Beta Consulting John Burkholder [email protected]

CPUC Consumer Affairs Branch 505 Van Ness Ave., #2003 San Francisco, CA 94102

CPUC Energy Rate Design & Econ. 505 Van Ness Ave., Rm. 4002 San Francisco, CA 94102

CPUC Pearlie Sabino [email protected]

CPUC - DRA Jacqueline Greig [email protected]

CPUC - DRA Galen Dunham [email protected]

CPUC - DRA R. Mark Pocta [email protected]

California Energy Commission Randy Roesser [email protected]

California Energy Market Lulu Weinzimer [email protected]

Calpine Corp Avis Clark [email protected]

City of Azusa Light & Power Dept. 215 E. Foothill Blvd. Azusa, CA 91702

City of Banning Paul Toor P. O. Box 998 Banning, CA 92220

City of Burbank Fred Fletcher/Ronald Davis 164 West Magnolia Blvd., Box 631 Burbank, CA 91503-0631

City of Colton Thomas K. Clarke 650 N. La Cadena Drive Colton, CA 92324

City of Long Beach, Gas & Oil Dept. Chris Garner 2400 East Spring Street Long Beach, CA 90806

City of Los Angeles City Attorney 200 North Main Street, 800 Los Angeles, CA 90012

City of Pasadena - Water and Power Dept. G Bawa [email protected]

City of Riverside Joanne Snowden [email protected]

City of Vernon Dan Bergmann [email protected]

Commerce Energy Catherine Sullivan [email protected]

Commerce Energy Blake Lazusso [email protected]

County of Los Angeles Stephen Crouch 1100 N. Eastern Ave., Room 300 Los Angeles, CA 90063

Crossborder Energy Tom Beach [email protected]

Culver City Utilities Heustace Lewis [email protected]

DGS Henry Nanjo [email protected]

Davis Wright Tremaine, LLP Edward W. O'Neill 505 Montgomery Street, Ste 800 San Francisco, CA 94111

Davis, Wright, Tremaine Judy Pau [email protected]

Dept. of General Services Celia Torres [email protected]


Douglass & Liddell Dan Douglass [email protected]

Douglass & Liddell Donald C. Liddell [email protected]

Downey, Brand, Seymour & Rohwer Dan Carroll [email protected]

Dynegy Mark Mickelson [email protected]

Dynegy - West Generation Joseph M. Paul [email protected]

Gas Transmission Northwest Corporation Bevin Hong [email protected]

General Services Administration Facilities Management (9PM-FT) 450 Golden Gate Ave. San Francisco, CA 94102-3611

Goodin, MacBride, Squeri, Ritchie & Day, LLP J. H. Patrick [email protected]

Goodin, MacBride, Squeri, Ritchie & Day, LLP James D. Squeri [email protected]

Hanna & Morton Norman A. Pedersen, Esq. [email protected]

Imperial Irrigation District K. S. Noller P. O. Box 937 Imperial, CA 92251

JBS Energy Jeff Nahigian [email protected]

Kern River Gas Transmission Company Janie Nielsen [email protected]

LA County Metro Julie Close [email protected]

LADWP Robert Pettinato [email protected]

LADWP Nevenka Ubavich [email protected]

Law Offices of William H. Booth William Booth [email protected]

Megan Lawson [email protected]

Luce, Forward, Hamilton & Scripps John Leslie [email protected]

MRW & Associates Robert Weisenmiller [email protected]

Manatt Phelps Phillips Randy Keen [email protected]

Manatt, Phelps & Phillips, LLP David Huard [email protected]

March Joint Powers Authority Lori Stone 23555 Meyer Drive, March Air Reserve Base, CA 92518-2038

Julie Morris [email protected]

National Utility Service, Inc. Jim Boyle One Maynard Drive, P. O. Box 712 Park Ridge, NJ 07656-0712

Navigant Consulting, Inc. Ray Welch [email protected]

PG&E Tariffs Pacific Gas and Electric [email protected]

Praxair Inc Rick Noger [email protected]

Regulatory & Cogen Services, Inc. Donald W. Schoenbeck 900 Washington Street, #780 Vancouver, WA 98660

Safeway, Inc Cathy Ikeuchi [email protected]


Sempra Global William Tobin [email protected]

Sierra Pacific Company Christopher A. Hilen [email protected]

Southern California Edison Co Fileroom Supervisor 2244 Walnut Grove Av, 290, GO1 Rosemead, CA 91770

Southern California Edison Co Karyn Gansecki 601 Van Ness Ave., #2040 San Francisco, CA 94102

Southern California Edison Co. Kevin Cini [email protected]

Southern California Edison Co. John Quinlan [email protected]

Southern California Edison Co. Colin E. Cushnie [email protected]

Southern California Edison Company Michael Alexander [email protected]

Southwest Gas Corp. John Hester P. O. Box 98510 Las Vegas, NV 89193-8510

Suburban Water System Bob Kelly 1211 E. Center Court Drive Covina, CA 91724

Sutherland, Asbill & Brennan Keith McCrea [email protected]

TURN Mike Florio [email protected]

TURN Marcel Hawiger [email protected]

The Mehle Law Firm PLLC Colette B. Mehle [email protected]

Western Manufactured Housing Communities Assoc. Sheila Day [email protected]

Proceeding A.08-09-023 - Advice 4110 Page 1

CALIF PUBLIC UTILITIES COMMISSION Christopher J. Blunt [email protected]

CALIF PUBLIC UTILITIES COMMISSION Taaru Chawla [email protected]

CALIF PUBLIC UTILITIES COMMISSION Christopher Danforth [email protected]

CALIF PUBLIC UTILITIES COMMISSION Jamie Fordyce [email protected]

CALIF PUBLIC UTILITIES COMMISSION Jessica T. Hecht [email protected]

CALIF PUBLIC UTILITIES COMMISSION Louis M. Irwin [email protected]

CALIF PUBLIC UTILITIES COMMISSION Robert Levin [email protected]

CALIF PUBLIC UTILITIES COMMISSION James Loewen [email protected]

CALIF PUBLIC UTILITIES COMMISSION Katherine McNabb [email protected]

SOUTHERN CALIFORNIA GAS COMPANY STEVEN D. PATRICK [email protected]

CALIF PUBLIC UTILITIES COMMISSION Marion Peleo [email protected]

THE UTILITY REFORM NETWORK NINA SUETAKE [email protected]

UTILITY WORKERS UNION OF AMERICA CARL WOOD [email protected]

ATTACHMENT B Advice No. 4110

Cal. P.U.C. Sheet No. Title of Sheet

Cancelling Cal. P.U.C. Sheet No.

1

Revised 46057-G PRELIMINARY STATEMENT - PART V - BALANCING ACCOUNTS, DESCRIPTION AND LISTING OF BALANCING ACCOUNTS, Sheet 1

Revised 45272-G*

Original 46058-G PRELIMINARY STATEMENT - PART V -

BALANCING ACCOUNTS, ADVANCED METERING INFRASTRUCTURE BALANCING ACCOUNT (AMIBA), Sheet 1

Original 46059-G PRELIMINARY STATEMENT - PART V - BALANCING ACCOUNTS, ADVANCED METERING INFRASTRUCTURE BALANCING ACCOUNT (AMIBA), Sheet 2

Original 46060-G PRELIMINARY STATEMENT - PART V - BALANCING ACCOUNTS, ADVANCED METERING INFRASTRUCTURE BALANCING ACCOUNT (AMIBA), Sheet 3

Revised 46061-G Rule No. 14, METER READING, Sheet 2 Original 42091-G Revised 46062-G Rule No. 31, AUTOMATED METER

READING, Sheet 1 Revised 24669-G

Revised 46063-G Rule No. 31, AUTOMATED METER READING, Sheet 2

Revised 24670-G

Revised 46064-G TABLE OF CONTENTS Revised 45844-G Revised 46065-G TABLE OF CONTENTS Revised 45779-G Revised 46066-G TABLE OF CONTENTS Revised 46056-G Revised 46067-G TABLE OF CONTENTS Revised 45979-G

SOUTHERN CALIFORNIA GAS COMPANY Revised CAL. P.U.C. SHEET NO. 46057-G LOS ANGELES, CALIFORNIA CANCELING Revised CAL. P.U.C. SHEET NO. 45272-G*

PRELIMINARY STATEMENT - PART V - BALANCING ACCOUNTS Sheet 1 DESCRIPTION AND LISTING OF BALANCING ACCOUNTS

(TO BE INSERTED BY UTILITY) ISSUED BY (TO BE INSERTED BY CAL. PUC)

ADVICE LETTER NO. 4110 Lee Schavrien DATE FILED May 10, 2010 DECISION NO. Senior Vice President EFFECTIVE Apr 8, 2010 1H6

10-04-027 Regulatory Affairs RESOLUTION NO.

A. GENERAL

Balancing accounts are those regulatory accounts where authorized expenses are compared with revenues from rates designed to recover those expenses. The resulting under or overcollection, plus interest calculated in the manner described in Preliminary Statement, Part I, is recorded on the Utility's financial statements as an asset or liability, which is owed from or due to the ratepayers. Balances in balancing accounts are to be amortized in rates.

B. LISTING OF BALANCING ACCOUNTS

Purchased Gas Account (PGA) Core Fixed Cost Account (CFCA) Noncore Fixed Cost Account (NFCA) Enhanced Oil Recovery Account (EORA) Noncore Storage Balancing Account (NSBA) California Alternate Rates for Energy Account (CAREA) Hazardous Substance Cost Recovery Account (HSCRA) Gas Cost Rewards and Penalties Account (GCRPA) Pension Balancing Account (PBA) Post-Retirement Benefits Other Than Pensions Balancing Account (PBOPBA) Conservation Expense Account (CEA) Research Development and Demonstration Gas Surcharge Account (RDDGSA) Demand Side Management Balancing Account (DSMBA) Direct Assistance Program Balancing Account (DAPBA) California Solar Initiative Balancing Account (CSIBA) Integrated Transmission Balancing Account (ITBA) Compressor Station Fuel and Power Balancing Account (CFPBA) Distribution Integrity Management Program Balancing Account (DIMPBA) Rewards and Penalties Balancing Account (RPBA) On-Bill Financing Balancing Account (OBFBA) Company Use Fuel for Load Balancing Account (CUFLBA) Firm Access Rights Balancing Account (FARBA) Advanced Metering Infrastructure Balancing Account (AMIBA)

N

SOUTHERN CALIFORNIA GAS COMPANY Original CAL. P.U.C. SHEET NO. 46058-G LOS ANGELES, CALIFORNIA CANCELING CAL. P.U.C. SHEET NO.

PRELIMINARY STATEMENT - PART V - BALANCING ACCOUNTS Sheet 1 N ADVANCED METERING INFRASTRUCTURE BALANCING ACCOUNT (AMIBA) N

(Continued) (TO BE INSERTED BY UTILITY) ISSUED BY (TO BE INSERTED BY CAL. PUC)

ADVICE LETTER NO. 4110 Lee Schavrien DATE FILED May 10, 2010DECISION NO. 10-04-027 Senior Vice President EFFECTIVE Apr 8, 20101H16 Regulatory Affairs RESOLUTION NO.

1. Purpose

The AMIBA is an interest bearing balancing account that is recorded on SoCalGas' financial statements. The purpose of the AMIBA is to record the costs and corresponding revenue requirement associated with the Advanced Metering Infrastructure (AMI) project, as outlined in Commission Decision (D.) 10-04-027 dated April 8, 2010. SoCalGas will deploy an AMI system by installing gas AMI meter modules and supporting communication network throughout its service territory. The total authorized gas program cost for SoCalGas is $1,050.7 million for a seven-year deployment period beginning in 2010 subject to additional costs authorized as described in Section 5 below.

2. Applicability

The AMIBA shall apply to all customer classes, except for any classes that may be specifically excluded by the Commission.

3. Rates The AMI authorized revenue requirement will be included in gas transportation rates as approved by the Commission.

4. Accounting Procedures

SoCalGas maintains this account by making monthly entries net of franchise fees and uncollectibles where applicable (except for entry “4.e.” which is recorded upon completion of the AMI project) as follows:

a) A debit entry equal to the AMI operating and maintenance (O&M) costs incurred by SoCalGas, including the costs of development, accounting, evaluation and administration;

b) An entry equal to the AMI capital related costs incurred by SoCalGas for depreciation,

property taxes, income taxes and return on investment; c) A credit entry equal to the monthly AMI authorized revenue requirement, net of benefits, that

are recovered through rates;

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(Continued)



d) A credit entry equal to O&M benefits based on the cumulative number of AMI meters installed and in operation for at least five months multiplied by $1.0304 which represents the average O&M benefit per meter per month as calculated in Exhibit SCG-7 of SoCalGas Application (A.) 08-09-023, Attachment MF-5, and adopted in D.10-04-027 (included in the authorized revenue requirement in 4.c.); the factor, as well as the corresponding O&M benefit embedded in the revenue requirement described in entry “c” above, is subject to revision to the extent O&M benefits associated with the AMI project are incorporated in future SoCalGas General Rate Case proceedings;

e) Upon completion of the AMI project, a debit or credit entry for the shareholder allocation of

any rewards for project cost underruns or penalties for project cost overruns, respectively, associated with the program funding limits described in Section 5.c. and 5.d. below;

f) An entry for amortization of the AMIBA balance as authorized by the Commission; and g) An entry equal to interest on the average of the balance in the account during the month,

calculated in the manner described in Preliminary Statement, Part I, J. 5. Program Funding Limit

The total authorized gas program cost for SoCalGas is $1,050.7 million for the seven-year deployment period beginning in 2010 consistent with D.10-04-027. Any unused funding can be carried over from one year to the next up to the maximum limit of $1,050.7 million during the deployment period. Consistent with Ordering Paragraph (OP) 1 and OP 2 of D.10-04-027, risk contingency and sharing mechanisms are described as follows:

a) Expenditures up to the total project cost of $1,050.7 million are deemed reasonable and will be recovered in rates without any after-the-fact reasonableness review.

b) To the extent actual project costs exceed the total cost of $1,050.7 million by up to $100

million, then 50% of the costs that exceed $1,050.7 million will be recovered in rates without any after-the-fact reasonableness review. The ratepayer portion of costs that exceed $1,050.7 million will be recorded in and recovered through the AMIBA.

c) To the extent actual project costs exceed the total cost of $1,050.7 million by up to $100

million, then 50% of the costs that exceed $1,050.7 million will be borne by SoCalGas shareholders and will not be recovered in rates. The shareholder allocation of these costs will be removed from the AMIBA (i.e., reflected as a credit adjustment to the AMIBA for the revenue requirement associated with the cost overrun).

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(Continued)



d) To the extent actual project costs are below the total cost of $1,050.7 million, then 10% of the difference between the $1,050.7 million and the actual project costs will be awarded to SoCalGas shareholders. This sharing mechanism will be applied to no more than the first $100 million of expenditures that fall below the total cost of $1,050.7 million. The shareholder allocation of the cost savings will be recorded as an adjustment to the AMIBA (i.e., reflected as a debit adjustment to the AMIBA for the revenue requirement associated with the cost underrun).

e) Project costs that exceed $1,150.7 million may be recoverable in rates to the extent approved

by the Commission following a reasonableness review of the additional costs. 6. Disposition

Pursuant to D.10-04-027, SoCalGas will include in rates the authorized revenue requirement for the AMI project over the project period. The balance remaining in the AMIBA after seven years, except the shareholder costs noted in Section 5, will be amortized in SoCalGas’ Annual Regulatory Account Balance Update filed in October of each year. Project costs that exceed $1,150.7 million will be included in rates after they are approved by the Commission following a reasonableness review.

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SOUTHERN CALIFORNIA GAS COMPANY Revised CAL. P.U.C. SHEET NO. 46061-G LOS ANGELES, CALIFORNIA CANCELING Original CAL. P.U.C. SHEET NO. 42091-G

Rule No. 14 Sheet 2 METER READING

(Continued)



C. Estimated Bills (Continued)

4. Advanced Metering Infrastructure (AMI) Meter Installation - If the Utility is unable to gain access to install an electronic meter reading device, the Utility may bill the customer for estimated consumption in accordance with C.1 and C.2.

D. Bills for Less Than 27 or More Than 33 Days Except as otherwise provided in certain rate schedules and bills utilizing daily allowance billing, all

bills, including opening and closing bills, for gas service rendered for a period of less than 27 days or more than 33 days will be computed in accordance with the applicable rate schedule and shall be prorated on the basis of the number of days service has been rendered to the number of days in an average month which shall be taken as 30 days. Proration will include the size of any rate blocks and recurring fixed monthly charges as stated in the rate schedule(s). Service establishment charges shall not be prorated.

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SOUTHERN CALIFORNIA GAS COMPANY Revised CAL. P.U.C. SHEET NO. 46062-G LOS ANGELES, CALIFORNIA CANCELING Revised CAL. P.U.C. SHEET NO. 24669-G

Rule No. 31 Sheet 1 AUTOMATED METER READING


ADVICE LETTER NO. 4110 Lee Schavrien DATE FILED May 10, 2010 DECISION NO. Senior Vice President EFFECTIVE Apr 8, 2010 1C8


A. GENERAL 1. The Utility, at its sole discretion, may install an automated meter reading device which transmits

readings from the meter to the Utility's facility via telephonic connection or other means. 2. The Utility shall notify the customer at least three days prior to the installation of an automated

reading device. 3. No rent, fee or other charge whatsoever shall be assessed by the customer or any third party against

the Utility for placing or maintaining an automated meter reading device upon a customer's premises. 4. The Utility shall own the automated meter reading device (and all rights to the data and information

produced thereby) and neither customer nor any other party shall have any right to repair, replace, modify, change or interconnect other equipment or facilities with such device or provide third parties with information or data therefrom, without Utility's prior written consent.

5. No meter fixtures or devices, nor any automated meter reading device shall be installed on the

Utility's meter without the Utility's prior written consent. 6. The Utility shall not be liable or responsible for the consequences of any utilization by customer or

any other party of information or data obtained from the automated meter reading device, including without limitation, any liability for direct, indirect, consequential, punitive or special damages, in tort or in contract.

7. The Utility may, at its sole discretion, remove the automated meter reading device from the

customer's premises. B. INSTALLATION OF METER READING DEVICE 1. When the automated meter reading device is installed for the convenience of the Utility, there shall

be no charge to the customer. However, if the device is installed for the customer's convenience, the Utility may charge the customer for the unit and installation cost.

2. If the device is being installed for the customer’s convenience, the customer shall permit the Utility

to connect the automated meter reading device to a customer's existing telephone line and install associated hardware, if needed.

3. The Utility shall not require a customer to install or modify telephone lines or to subscribe to the

local telephone company in order to obtain service.

D T T T T N


Rule No. 31 Sheet 2 AUTOMATED METER READING

(Continued)


ADVICE LETTER NO. 4110 Lee Schavrien DATE FILED May 10, 2010 DECISION NO. Senior Vice President EFFECTIVE Apr 8, 2010 2C8


B. INSTALLATION OF METER READING DEVICE (Continued) 4. If a customer of the Utility is billed by the local telephone company for any charges attributable to

the Utility's automated meter reading device, the Utility shall reimburse the customer for such charges.

5. Any automated meter reading device installed by the Utility shall release control of the customer's

telephone line whenever the customer's telephone equipment is otherwise in use. However, mechanical operation of the device can result in temporary interruption of telephone service if the telephone is picked up when the device is transmitting data to the Utility's computer.

6. All automated meter reading devices installed at customer premises shall be in locations acceptable

to the Utility, and placed so as to be at all times accessible for inspecting, reading and testing by the Utility.

7. The customer shall exercise reasonable care to prevent the automated meter reading device from

being damaged or destroyed and shall refrain from interfering with its operation. The customer shall notify the Utility if any defects are discovered in the automated meter reading device.

8. If the automated meter reading device is damaged by a customer, the Utility may charge the customer

for replacing or repairing the device.

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TABLE OF CONTENTS




RULES Rule Number Title of Sheet Cal. P.U.C. Sheet No.

1 Definitions ........................... 43351-G,45366-G,45820-G,45821-G,45822-G,45368-G 45369-G,45370-G,45371-G,45372-G,45823-G,45824-G 45825-G,45826-G,45827-G,45828-G,45829-G,45830-G,45831-G 2 Description of Service ....................................... 45832-G,45833-G,45834-G,45835-G 45836-G,45837-G,45838-G,45839-G,45840-G 3 Application for Service .................................................... 35524-G,35525-G,35526-G 4 Contracts .......................................................................................... 35529-G,43366-G 5 Special Information Required on Forms ......................................... 43456-G,43457-G 6 Establishment and Re-Establishment of Credit ............................... 41756-G,41757-G 7 Deposits ........................................................................................................... 42168-G 9 Discontinuance of Service ................................. 41229-G,41230-G,41231-G,41232-G

41233-G,41234-G,41235-G 10 Service Charges .................................. 39813-G,38903-G,38904-G,38905-G,38906-G 11 Disputed Bills .................................................................................. 39418-G,39419-G 12 Rendering and Payment of Bills ........................ 42086-G,42087-G,42088-G,42089-G 13 Meters and Equipment ..................................................................... 45841-G,45842-G 14 Meter Reading ................................................................................. 42614-G,46061-G 15 Meter Tests ...................................................................................................... 36872-G 16 Adjustment of Bills .......................................................... 42615-G,36874-G,36875-G 18 Notices ............................................................................................................. 38239-G 19 Rates and Optional Rates ................................................................................ 40825-G 20 Gas Main Extensions ........... 31800-G,31801-G,38506-G,42765-G,32375-G,32376-G 42766-G,31807-G,37767-G,42767-G,37769-G,42768-G,42769-G 21 Gas Service Extensions ....... 31813-G,31814-G,31815-G,31816-G,31817-G,31818-G 31819-G,31820-G,38510-G,31822-G,31823-G,31824-G,31825-G 22 Temporary Service .......................................................................... 43783-G,43784-G 23 Continuity of Service and Interruption of Delivery ............................. 45385-G,43367-G,33041-G,33042-G,34021-G,33044-G 36622-G,33046-G,44940-G,44941-G,44942-G,44943-G 24 Supply to Individual Premises and Resale of Gas ............ 39422-G,39925-G,39926-G 25 Company's Right of Ingress to and Egress from the Consumer's Premises ............................................................................... 24655-G

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(Continued)



RULES (continued) 26 Consumer Responsible for Equipment for Receiving and Utilizing Gas .......................................................................... 45843-G 27 Service Connections Made by Company's Employees ..................................................................................................... 24657-G 28 Compensation to Company's Employees ........................................................ 24658-G 29 Change of Consumer's Apparatus or Equipment ............................................. 24659-G 30 Transportation of Customer-Owned Gas ........... 43369-G,43370-G,36318-G,45386-G 45387-G,43373-G,43374-G,43375-G 45388-G,45389-G,45390-G,45391-G,43380-G 43381-G,45010-G,43383-G,43384-G 31 Automated Meter Reading .............................................................. 46062-G,46063-G 32 Core Aggregation Transportation ...................... 30018-G,31199-G,36722-G,30021-G 30022-G,36723-G,36724-G,39585-G,39586-G,30027-G 30028-G,30029-G,30030-G,30031-G,30032-G,30033-G 43385-G,43386-G,45777-G,39589-G,36623-G,30039-G 33 Electronic Bulletin Board (EBB) ...................... 43388-G,43389-G,45392-G,45393-G 45394-G,45395-G,45396-G,45397-G,45398-G 34 Provision of Utility Right-of-Way Information ............... 33298-G,33299-G,33300-G 33301-G,33302-G,33303-G 35 Contracted Marketer Transportation ................. 27068-G,27069-G,27070-G,27071-G 36325-G,27073-G,36326-G,27075-G 36 Interstate Capacity Brokering .......................................................... 39590-G,39591-G 38 Commercial/Industrial Equipment Incentive Program ............................ 32745-G,32746-G,32747-G,32748-G,32749-G 39 Access to the SoCalGas Pipeline System .............................................................. 43395-G,43396-G,43397-G 40 On-Bill Financing Program ............................................................. 44205-G,41155-G 41 Utility System Operation ................................... 45399-G,45400-G,45401-G,45402-G 45403-G,45404-G,45405-G,45406-G

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TABLE OF CONTENTS




The following listed sheets contain all effective Schedules of Rates and Rules affecting service and information relating thereto in effect on the date indicated thereon. GENERAL Cal. P.U.C. Sheet No.

Title Page ...................................................................................................................................... 40864-G Table of Contents--General and Preliminary Statement ................................ 46066-G,46067-G,45654-G Table of Contents--Service Area Maps and Descriptions ............................................................ 41970-G Table of Contents--Rate Schedules .............................................................. 46054-G, 46055-G,45999-G Table of Contents--List of Cities and Communities Served ......................................................... 45168-G Table of Contents--List of Contracts and Deviations ................................................................... 45168-G Table of Contents--Rules ............................................................................................... 46064-G,46065-G Table of Contents--Sample Forms ................................... 44931-G,45414-G,45144-G,45415-G,45145-G

PRELIMINARY STATEMENT

Part I General Service Information .................................. 45597-G,24332-G,24333-G,24334-G,24749-G Part II Summary of Rates and Charges ............ 46034-G,46035-G,46036-G,46037-G,45701-G,45702-G 46038-G,45996-G,45606-G,45607-G,45608-G,46006-G,46007-G,46008-G,45612-G Part III Cost Allocation and Revenue Requirement ........ 45267-G,45268-G,45269-G,45613-G,45614-G Part IV Income Tax Component of Contributions and Advances ................................. 45265-G,24354-G Part V Balancing Accounts

Description and Listing of Balancing Accounts ................................................................... 46057-G Purchased Gas Account (PGA) ............................................................................. 45754-G,45755-G Core Fixed Cost Account (CFCA) ........................................................................ 45273-G,45274-G Noncore Fixed Cost Account (NFCA) .................................................................. 45275-G,45276-G Enhanced Oil Recovery Account (EORA) ........................................................................... 45277-G Noncore Storage Balancing Account (NSBA) ...................................................... 44191-G,44192-G California Alternate Rates for Energy Account (CAREA) ................................... 45882-G,45883-G Hazardous Substance Cost Recovery Account (HSCRA) .................... 40875-G, 40876-G,40877-G Gas Cost Rewards and Penalties Account (GCRPA) ........................................................... 40881-G Pension Balancing Account (PBA) ....................................................................... 45013-G,45014-G Post-Retirement Benefits Other Than Pensions Balancing Account (PBOPBA) . 45015-G,45016-G Conservation Expense Account (CEA) ................................................................. 40886-G,40887-G

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SOUTHERN CALIFORNIA GAS COMPANY Revised CAL. P.U.C. SHEET NO. 46067-G LOS ANGELES, CALIFORNIA CANCELING CAL. P.U.C. SHEET NO.

TABLE OF CONTENTS

(Continued)




PRELIMINARY STATEMENT (Continued)

Part V Balancing Accounts (Continued) Research Development and Demonstration Gas Surcharge Account (RDDGSA) .............. 40888-G Demand Side Management Balancing Account (DSMBA) .................................. 45194-G,41153-G Direct Assistance Program Balancing Account (DAPBA) .................................................. 40890-G California Solar Initiative Balancing Account (CSIBA) ..................................................... 41104-G Integrated Transmission Balancing Account (ITBA) .......................................................... 45278-G Compressor Station Fuel and Power Balancing Account (CFPBA) ................................... 43693-G Distribution Integrity Management Program Balancing Account (DIMPBA) ................... 43694-G Rewards and Penalties Balancing Account (RPBA) ........................................................... 43695-G On-Bill Financing Balancing Account (OBFBA) ................................................................. 45195-G Fuel for Load Balancing Account (CUFLBA) .................................................................... 45279-G Firm Access Rights Balancing Account (FARBA) ............................................................. 45280-G Advanced Metering Infrastructure Balancing Account (AMIBA) ..........46058-G,46059-G,46060-G

Part VI Memorandum Accounts

Description and Listing of Memorandum Accounts ............................................................ 45976-G PCB Expense Account (PCBEA) ......................................................................................... 40893-G Research Development and Demonstration Expense Account (RDDEA) ............................ 43697-G Curtailment Violation Penalty Account (CVPA) ................................................................. 40895-G Economic Practicality Shortfall Memorandum Account (EPSMA) ..................................... 40896-G Catastrophic Event Memorandum Account (CEMA) ........................................... 40897-G,40898-G Vernon Avoided Distribution Cost Memorandum Account (VADCMA) ........................... 40899-G Vernon Rate Savings Memorandum Account (VRSMA) .................................................... 40900-G Vernon Negotiated Core Contract Memorandum Account (VNCCMA) ............................. 40901-G Research Royalty Memorandum Account (RRMA) ............................................................ 43698-G Intervenor Award Memorandum Account (IAMA) ............................................................. 40904-G Z Factor Account (ZFA) ...................................................................................................... 40905-G Self-Generation Program Memorandum Account (SGPMA) .............................................. 41105-G Blythe Operational Flow Requirement Memorandum Account (BOFRMA) ....... 45282-G,45283-G FERC Settlement Proceeds Memorandum Account (FSPMA) ............................................ 45756-G Gain/Loss on Sale Memorandum Account (GLOSMA) ...................................................... 42133-G Affiliate Transfer Fee Account (ATFA) .............................................................................. 40919-G Firm Access and Storage Rights Memorandum Account (FASRMA) ................................ 45284-G General Rate Case Revenue Requirements Memorandum Account (GRCRRMA) ............. 43701-G 2009-2011 Energy Efficiency Memorandum Account (EEMA) ......................................... 44000-G System Reliability Memorandum Account (SRMA) .............................................................45285-G Fire Hazard Prevention Memorandum Account (FHPMA) ...................................................44984-G Disconnect Memorandum Account (DMA) ...........................................................................45738-G California Solar Initiative Thermal Project Memorandum Account (CSITPMA) .................45977-G

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ATTACHMENT C

Advice No. 4110

Forecasted AMI Annual Revenue Requirement

Years 2010 - 2017

2010 ** 2011 ** 2012 2013 2014 2015 2016 2017

Franchise Fees & Uncollectibles - - 597.1 1,508.2 2,019.4 2,541.3 3,050.8 2,605.1 O&M expenses - - 19,350.1 27,718.6 32,708.2 36,487.8 38,649.9 19,418.7 Property Taxes - - 1,340.9 2,633.9 4,073.8 5,576.1 7,212.5 8,092.4 Preferred Equity Interest - - 342.0 671.8 1,039.1 1,422.3 1,839.7 2,064.1 Interest Expense - - 3,517.8 6,910.0 10,687.6 14,629.0 18,922.1 21,230.6 Depreciation Expense - - 18,377.9 25,130.1 32,983.4 41,377.8 49,836.8 41,083.2 Federal Tax Expense - - (10,869.0) 10,694.8 14,766.5 18,855.0 22,743.3 19,077.4 State Tax Expense - - (3,219.1) 2,326.8 3,269.7 4,973.9 6,616.5 5,247.4 Return on Equity - - 5,755.3 11,305.2 17,485.6 23,934.0 30,957.6 34,734.5

Revenue Requirement* - - 35,192.9 88,899.4 119,033.3 149,797.2 179,829.1 153,553.3

O&M Benefits - - (7.3) (4,186.4) (18,033.0) (33,620.4) (56,633.4) (72,334.2) Net Revenue Requirement - - 35,185.6 84,712.9 101,000.3 116,176.8 123,195.7 81,219.1

* Revenue Requirement shown above is net of Working Cash benefits:Revenue Requirement associated with WC Reduction - - (147.5) (779.2) (1,981.7) (2,672.8) - -

** Revenue requirement included in 2012 for these years.

Annual Summary of Monthly Revenue Requirement (For Rate Purposes) - 2012-2017 ($ in thousands)


Final Decision - April 8, 2010All Property and O&M - Total Costs & Benefits

2010 2011 2012 2013 2014 2015 2016 2017

Franchise Fees & Uncollectibles (165.0) (204.5) 966.6 1,508.2 2,019.4 2,541.3 3,050.8 2,605.1 O&M expenses 1,576.4 3,541.5 14,232.1 27,718.6 32,708.2 36,487.8 38,649.9 19,418.7 Property Taxes 4.4 37.8 1,298.7 2,633.9 4,073.8 5,576.1 7,212.5 8,092.4 Preferred Equity Interest 1.1 9.6 331.3 671.8 1,039.1 1,422.3 1,839.7 2,064.1 Interest Expense 11.6 99.1 3,407.1 6,910.0 10,687.6 14,629.0 18,922.1 21,230.6 Depreciation Expense 18.8 158.3 18,200.7 25,130.1 32,983.4 41,377.8 49,836.8 41,083.2 Federal Tax Expense (8,932.6) (12,500.2) 10,563.8 10,694.8 14,766.5 18,855.0 22,743.3 19,077.4 State Tax Expense (2,258.2) (3,358.9) 2,398.1 2,326.8 3,269.7 4,973.9 6,616.5 5,247.4 Return on Equity 19.0 162.1 5,574.2 11,305.2 17,485.6 23,934.0 30,957.6 34,734.5

Revenue Requirement* (9,724.3) (12,055.3) 56,972.5 88,899.4 119,033.3 149,797.2 179,829.1 153,553.3

Benefits - - (7.3) (4,186.4) (18,033.0) (33,620.4) (56,633.4) (72,334.2) Net Revenue Requirement (9,724.3) (12,055.3) 56,965.2 84,712.9 101,000.3 116,176.8 123,195.7 81,219.1

* Revenue Requirement shown above is net of Working Cash benefits:Revenue Requirement associated with WC Reduction - - (147.5) (779.2) (1,981.7) (2,672.8) - -

Southern California Gas Company

All Property and O&M - Total Costs & BenefitsAnnual Summary of Monthly Revenue Requirement - 2010-2017 ($ in thousands)

Final Decision - April 8, 2010Advanced Metering Infrastructure

Electric Meters & Gas Modules 2010 2011 2012 2013 2014 2015 2016 2017

Franchise Fees & Uncollectibles (165.0) (204.5) 969.1 1,521.4 2,053.0 2,586.7 3,050.8 2,605.1 O&M expenses 1,576.4 3,541.5 14,232.1 27,718.6 32,708.2 36,487.8 38,649.9 19,418.7 Property Taxes 4.4 37.8 1,311.0 2,699.7 4,242.5 5,806.6 7,212.5 8,092.4 Preferred Equity Interest 1.1 9.6 334.4 688.6 1,082.1 1,481.1 1,839.7 2,064.1 Interest Expense 11.6 99.1 3,439.5 7,082.7 11,130.2 15,233.6 18,922.1 21,230.6 Depreciation Expense 18.8 158.3 18,200.7 25,130.1 32,983.4 41,377.8 49,836.8 41,083.2 Federal Tax Expense (8,932.6) (12,500.2) 10,598.9 10,876.3 15,218.1 19,441.0 22,743.3 19,077.4 State Tax Expense (2,258.2) (3,358.9) 2,406.9 2,373.5 3,387.9 5,132.3 6,616.5 5,247.4 Return on Equity 19.0 162.1 5,627.3 11,587.7 18,209.6 24,923.2 30,957.6 34,734.5

Revenue Requirement (9,724.3) (12,055.3) 57,120.0 89,678.6 121,015.0 152,470.0 179,829.1 153,553.3

Annual Summary of Monthly Revenue Requirement - 2010-2017 ($ in thousands)


Final Decision - April 8, 2010All Property and O&M - Total O&M & Capital Costs

Working Cash Benefits 2010 2011 2012 2013 2014 2015 2016 2017

Franchise Fees & Uncollectibles - - (2.5) (13.2) (33.6) (45.3) - - O&M expenses - - - - - - - - Property Taxes - - (12.4) (65.8) (168.7) (230.5) - - Preferred Equity Interest - - (3.2) (16.8) (43.0) (58.8) - - Interest Expense - - (32.5) (172.7) (442.6) (604.6) - - Depreciation Expense - - - - - - - - Federal Tax Expense - - (35.1) (181.5) (451.6) (586.0) - - State Tax Expense - - (8.9) (46.6) (118.2) (158.4) - - Return on Equity - - (53.1) (282.6) (724.0) (989.2) - -

Revenue Requirement - - (147.5) (779.2) (1,981.7) (2,672.8) - -

Annual Summary of Monthly Revenue Requirement - 2010-2017 ($ in thousands)


Final Decision - April 8, 2010Benefits associated with Reduction in Working Cash Requirement

2010 2011 2012 2013 2014 2015 2016 2017O&M Benefit Giveback - - (7.3) (4,186.4) (18,033.0) (33,620.4) (56,633.4) (72,334.2)

O&M Benefits Giveback - Annual Summary ($ in Thousands)


Final Decision - April 8, 2010Total O&M Benefits

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